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Topic: Airline Mergers
Username: COERJ145
Posted 2005-08-03 06:14:42 and read 3795 times.

With the ongoing merger between HP and US, could some of these possible mergers work?

CO+DL?
CO+AS?
AA+DL?
B6+F9?
YX+AI?

All of these combo's have simiar route structures, fleet commentality, and each possible airline would benefit from the mergers by gaining more cities to support their routes. I can't find any good matches for NW, or UA. Any Suggustions?

-Jeff M

Topic: RE: Airline Mergers
Username: JetBlueAtJFK
Posted 2005-08-03 06:23:04 and read 3758 times.

Quoting COERJ145 (Thread starter):
CO+DL

Maybe, but they are both strong on the east, they should do something like US/HP with strong on both coasts.

Quoting COERJ145 (Thread starter):
CO+AS?

That seems better, don't know if it will work but sounds reasonable.

Quoting COERJ145 (Thread starter):
AA+DL?

Maybe, kind of odd match though. AA doesn't seem to go with anyone well.

Quoting COERJ145 (Thread starter):
B6+F9?

Maybe, but B6 does great on their own and F9 is doing ok but they are a good match in-case anything happens but they are both well run

Quoting COERJ145 (Thread starter):
YX+AI?

Wait, Midwest and who? Code won't come out.

 airplane jetBlueAtJFK airplane 

Topic: RE: Airline Mergers
Username: COERJ145
Posted 2005-08-03 06:30:02 and read 3748 times.

Quoting JetBlueAtJFK (Reply 1):
Wait, Midwest and who? Code won't come out

Airtran...sorry

Topic: RE: Airline Mergers
Username: Flyibaby
Posted 2005-08-03 06:33:51 and read 3743 times.

B6 is too sure of themselves to merge with anyone, and I think they can afford to be. They keep adding aircraft and keeping the LF around 90% and keep pulling off a profit, even with the fuel costs. I don't see them doing anything other than on their own.

Topic: RE: Airline Mergers
Username: JetBlueAtJFK
Posted 2005-08-03 06:39:51 and read 3740 times.

Quoting Flyibaby (Reply 3):
B6 is too sure of themselves to merge with anyone, and I think they can afford to be. They keep adding aircraft and keeping the LF around 90% and keep pulling off a profit, even with the fuel costs. I don't see them doing anything other than on their own.

YES

Quoting COERJ145 (Reply 2):
Airtran...sorry

Ok, so I think FL and YX, would be ok... but they could do better. They both are focused on the same region (east and midwest-FL not so much)
--
US+UA could work, they already codeshare so...
UA+CO-CO strong on east and Europe, while UA is strong on EAST, WEST (Kind of) and the PACIFIC for sure.

 airplane jetBlueAtJFK airplane 

Topic: RE: Airline Mergers
Username: Ramerinianair
Posted 2005-08-03 06:50:46 and read 3726 times.

AirTran's code is FL. I think that the only one who can merge with AA would be UA since they have the common ORD hub and large ops in JFK and LGA. This would consolidate some routes and instead of competing, they could dominate. Of course, there would be the anti-trust thing. They have mostly Boeing fleets and the vast domestic presence of AA could boost feed the pacific dominance of UA. They are both the only ones who are allowed into LHR too!
SR

Topic: RE: Airline Mergers
Username: StevenUhl777
Posted 2005-08-03 06:58:16 and read 3716 times.

Quoting JetBlueAtJFK (Reply 4):
US+UA could work, they already codeshare so...

Been there, already attempted, failed...luckily. Bad idea, all around.

Quoting Ramerinianair (Reply 5):
I think that the only one who can merge with AA would be UA since they have the common ORD hub and large ops in JFK and LGA.

Not a chance. UA is not big in JFK and LGA, but AA is.

Signed,
US Department of Justice
European Union
Government of Japan
and on and on and on...

Topic: RE: Airline Mergers
Username: Commavia
Posted 2005-08-03 07:02:39 and read 3701 times.

Quoting Ramerinianair (Reply 5):
I think that the only one who can merge with AA would be UA since they have the common ORD hub and large ops in JFK and LGA. This would consolidate some routes and instead of competing, they could dominate. Of course, there would be the anti-trust thing.

Yeah -- a big anti-trust thing. You could say that again.

AA and UA's route network overlap (not so much in New York, but definitely Chicago, L.A., transcon) would pretty much guarantee that the merger would never get regulatory approval. These two companies -- which arguably have the most overlapping networks of any two major legacy carriers in the U.S. -- would never get off the ground for precisely the reason you state -- they would consolidate routes and dominate. AA and UA together would have about one third of the entire U.S. market. DOJ would never allow that.

Topic: RE: Airline Mergers
Username: Jdaniel001
Posted 2005-08-03 07:11:19 and read 3691 times.

There will be one big domestic full-service carrier after AA gobbles up NW, DL, and CO. Then a few national LCC's, the new US, WN, B6, Ted and then maybe a few regionals. UA will be the biggest US flag carrier overseas. However, it will dump most of it's domestic presence and concentrate on the major business centers and TED and Express.

Topic: RE: Airline Mergers
Username: 1MillionFlyer
Posted 2005-08-03 07:38:31 and read 3652 times.

Quoting STLGph (Reply 9):
yes. have school year around so kids spend less time staying up late on their parents computers and posting redundant threads.

Awesome  Smile

Topic: RE: Airline Mergers
Username: Liedetectors
Posted 2005-08-03 07:45:17 and read 3637 times.

STLGph you just won my respect. Good call!

Topic: RE: Airline Mergers
Username: COERJ145
Posted 2005-08-03 08:02:13 and read 3597 times.

Quoting STLGph (Reply 9):
yes. have school year around so kids spend less time staying up late on their parents computers and posting redundant threads.

Hey, I own my comp anyway, if u don't like the thread, don't relpy to it, or suggust to have it deleted. I am also not a kid, i'm a teenager with an intrest in the world of aviaton hoping to become a pilot.  Angry

Topic: RE: Airline Mergers
Username: STLGph
Posted 2005-08-03 08:15:10 and read 3579 times.

Quoting COERJ145 (Reply 12):
i'm a teenager with an intrest in the world of aviaton hoping to become a pilot.

you want to be a pilot? then you'd better get busy suggesting lots of merger possibilities so you can be sure to have a job in a few years.

Topic: RE: Airline Mergers
Username: 1MillionFlyer
Posted 2005-08-03 08:18:30 and read 3576 times.

The issue is is that mergers have lots of hidden costs, ruin corporate cultures and normally start the demise and bankruptcy of the acquiring carrier

Airline History:

US Airways purchased:
PSA
Piedmont = Bankrupt

Continental purchased:
PeopleExpress = bankrupt (but survived)

American purchased:
TWA = American almost went bankrupt

Delta purchased:
ASA
Comair
Pan Am Europe Assets = almost bankrupt

etc etc etc

Topic: RE: Airline Mergers
Username: Aggieflyboi04
Posted 2005-08-03 08:25:24 and read 3559 times.

WN, FL, F9, B6 hehe would be intresting but will NEVER HAPPEN

Topic: RE: Airline Mergers
Username: COERJ145
Posted 2005-08-03 08:30:57 and read 3549 times.

Quoting STLGph (Reply 13):
you want to be a pilot? then you'd better get busy suggesting lots of merger possibilities so you can be sure to have a job in a few years.

Stop with the sarcasm!!!!!!!! bomb 

Topic: RE: Airline Mergers
Username: STLGph
Posted 2005-08-03 08:35:11 and read 3545 times.

Quoting COERJ145 (Reply 16):
Stop with the sarcasm!!!!!!!!

hey, honestly, i think it's great you know what you want to do. and i hope you stick to it. and i hope you're successful at it. and you get one hell of a dental plan. but never, ever, wish against yourself.

Topic: RE: Airline Mergers
Username: Vegasplanes
Posted 2005-08-03 09:05:06 and read 3516 times.

Quoting 1MillionFlyer (Reply 14):
Airline History:

US Airways purchased:
PSA
Piedmont = Bankrupt

Continental purchased:
PeopleExpress = bankrupt (but survived)

American purchased:
TWA = American almost went bankrupt

Delta purchased:
ASA
Comair
Pan Am Europe Assets = almost bankrupt

etc etc etc

Don't forget about Pan Am-National=well, we know.

Texas Int'l-Continental

Texas Int'l/Continental/People Express and Eastern, that was a GREAT combo.  Wink

Topic: RE: Airline Mergers
Username: Vegasplanes
Posted 2005-08-03 09:07:00 and read 3515 times.

Quoting Vegasplanes (Reply 18):

Texas Int'l/Continental/People Express and Eastern, that was a GREAT combo. Wink

I forgot that NY Air, Provincetown-Boston, and the original Frontier was also in that tangled mess, Britt Airways might also be included, so many airlines, so little memory.

Topic: RE: Airline Mergers
Username: SHUPirate1
Posted 2005-08-03 11:11:47 and read 3485 times.

Quoting COERJ145 (Thread starter):
CO+DL

Actually, this wouldn't be such a bad combination...just think, you'd have hubs in Atlanta, Cincinnati, Houston, Newark, and Salt Lake City, (presumably Cleveland would be cut) and assuming the DC-9 variants got gutted, which isn't all that unlikely, you'd have an all-Boeing operator. The only issue might be that huge smattering of focus cities that Delta has, namely Boston, Fort Lauderdale, New York (both Kennedy and LaGuardia) Orlando, Tampa, and Washington, of which some (the New York operations for starters) would be gone.

Quoting COERJ145 (Thread starter):
CO+AS?

Alaska Airlines is, put simply, nothing short of a mess right now. With their labor strife among their current employees, to say nothing of their 472 ramp service and stores agents at Seattle who are currently looking for another job, I'm not sure who would want to touch them. Operationally, however, this would be a relatively good fit, with hubs in Cleveland, Houston, Newark, and Seattle, and in Alaska's case, a nearly all-Boeing fleet, although the 737-200 and 737-400 would be new 737-variants in Continental's fleet, so those might go. In all likelyhood, the MD-80's Alaska has would be gone.

Quoting COERJ145 (Thread starter):
AA+DL?

Would be unlikely to get past the Department of Justice. For one, the combined carrier would be the largest slotholder at LaGuardia, in addition to likely being the largest carrier at Kennedy as well, although in neither case do they share a significant number of destinations (obviously, there is some overlap). Looking beyond the Big Apple, however, this could be a good fit. DL's MD-90's are an oddball, and likely would be gone, and the MD-88's could see the same fate. Likewise, Delta's 737-200's and 737-300's would likely be jettisoned, along with American's Airbuses. The other issue would be the regional fleets, with little synergy other than the CRJ-700, as American Eagle otherwise operates all-Embraer aircraft, whereas with the exception of Atlantic Southeast's ATR's (which would likely be spun into Executive Airlines d/b/a American Eagle), Atlantic Southeast and Comair operate all Bombardier aircraft. At this point, you have a pretty good fleet mix, plus hubs in Atlanta, Chicago (O'Hare), Cincinnati, Dallas-Fort Worth, Miami, St. Louis, Salt Lake City, and San Juan. St. Louis would likely be gone, however other than that, there aren't any other hubs that are obvious choices to pull down. The carrier would also be the dominant carrier in Boston, it should be worth noting.

Quoting COERJ145 (Thread starter):
B6+F9?

This merger makes a bit of sense, and might actually be a GREAT idea, as it would give jetBlue an opportunity to right-size, and in some cases (Burbank comes to mind) right-perform some routes, and perhaps start to string together jetBlue's currently disjointed network, using Denver and New York as the hubs.

Quoting COERJ145 (Thread starter):
YX+FL?

This happens to be one I don't like, simply because Midwest simply is saddled with too many problems and too many poor business decisions to survive. The 328Jet is an absolute disaster economically, and additionally, Midwest's business plan simply involves chasing after a segment of the market that is increasingly getting smaller. Furthermore, Midwest outsourcing their Milwaukee ramp to Skyway (OK, Skyway is wholly-owned by Midwest, but with much lower pay) will likely turn into a decision that will saddle them in this market for any passenger who isn't originating or terminating in Milwaukee. airTran pursuing this would be nothing short of a disaster.

Topic: RE: Airline Mergers
Username: FlyGuyClt
Posted 2005-08-03 13:42:56 and read 3398 times.

Take it from someone who has been there and done that. MERGERS, while they may look good on a route map are awful. Different company cultures, employees, seniority, and anything else that is negative.

Oh, the days of Florida Express and the BAC 1-11. Merger with Braniff II. However, that merger was great for us. The Braniff folks were awesome. But in the end. Bankruptcy, of course the owner at the time went to jail and then NBC but him on The Restaurant and we all got to see Rocco get nailed by this slim on national TV.

Safe Flying  Smile

Topic: RE: Airline Mergers
Username: ARCJET
Posted 2005-08-03 15:30:26 and read 3327 times.

West Coast, Bonanza, Pacific = Air West + Howard Hughes = Hughes Airwest
Southern + North Central = Republic
Republic purchases Hughes Airwest
Northwest purchases Republic

Topic: RE: Airline Mergers
Username: Jdaniel001
Posted 2005-08-03 16:21:38 and read 3273 times.

Actually the entire aviation industry will merge into one mega carrier.

Topic: RE: Airline Mergers
Username: Skyexramper
Posted 2005-08-03 19:09:13 and read 3184 times.

Quoting COERJ145 (Thread starter):
YX+AI?

AL it would be and that would be the offical Skyway code. That happened a long time ago! :P

Topic: RE: Airline Mergers
Username: Isitsafenow
Posted 2005-08-04 00:47:50 and read 3076 times.

1MILLIONFLYER..post 13
I didn't know Piedmont went Bankrupt. I thought US AIR bought them and merged them into their system. Are you sure about that?
safe

Topic: RE: Airline Mergers
Username: Dutchjet
Posted 2005-08-04 01:18:57 and read 3034 times.

At this point in time, the major US carriers have enough of their own problems to consider and no airline is in the position to take on the problems and debt of any other carrier. I simply do not think that we are going to see a further consolidation of the US airline industry at this point in time - yes, I know that the US/HP deal is going forward but lets see if this matchup is as successful as some people seem to think it will be. I am not optimistic, as mergers such as this have never really worked out as planned.

Does anyone think that CO or AA is going to take on DL's debt? With over 100 new airplanes on order and the ability to open up any route that it pleases, why would JetBlue buy another carrier? And what would AirTran gain by taking on Midwest's problems? Airline mergers are complicated, expensive, it takes years to intergrate fleets and operating practices, and then there are the employees and unions to deal with.

Topic: RE: Airline Mergers
Username: Srbmod
Posted 2005-08-04 01:45:04 and read 2999 times.

Quoting Isitsafenow (Reply 24):
I didn't know Piedmont went Bankrupt. I thought US AIR bought them and merged them into their system. Are you sure about that?
safe

The equation in a more understandable layout:

USAir + Piedmont + PSA = US Airways filing for CH 11 twice in nearly as many years.

Topic: RE: Airline Mergers
Username: SHUPirate1
Posted 2005-08-04 06:43:36 and read 2875 times.

Quoting Jdaniel001 (Reply 22):
Actually the entire aviation industry will merge into one mega carrier.

Oh, heaven forbid...now New York to Fort Lauderdale will go back to $1000 for a one way ticket...in all likelyhood, at least, that will include a four-course steak-and-lobster meal!  Wink

Topic: RE: Airline Mergers
Username: Mariner
Posted 2005-08-04 06:53:13 and read 2878 times.

Quoting SHUPirate1 (Reply 19):
as it would give jetBlue an opportunity to right-size,



Quoting SHUPirate1 (Reply 19):
and perhaps start to string together jetBlue's currently disjointed network

Might be good for JetBlue.

It would do jacksh*t for Frontier, except destroy a perfectly good airline.

 brokenheart 

cheers

mariner

Topic: RE: Airline Mergers
Username: PlanesNTrains
Posted 2005-08-04 09:15:42 and read 2819 times.

[Quoting COERJ145 (Thread starter):
CO+DL[/quote]

Probably the most logical combo of the legacies.

[Quoting COERJ145 (Thread starter):
AA+DL?[/quote]

Also an intriguing idea, but ultimately too unwieldy to work. Way too many employee integration issues, way too many hubs/focus cities, way too much debt, etc. Just too much of everything.

[Quoting COERJ145 (Thread starter):
B6+F9?[/quote]

Quoting SHUPirate1 (Reply 19):
This merger makes a bit of sense, and might actually be a GREAT idea, as it would give jetBlue an opportunity to right-size, and in some cases (Burbank comes to mind) right-perform some routes, and perhaps start to string together jetBlue's currently disjointed network, using Denver and New York as the hubs.

People Express + Frontier, part 2? A 747 super shuttle between DEN and JFK? Hmmm...  Smile

Quoting SHUPirate1 (Reply 19):
Quoting COERJ145 (Thread starter):
YX+FL?



Quoting SHUPirate1 (Reply 19):
This happens to be one I don't like, simply because Midwest simply is saddled with too many problems and too many poor business decisions to survive. The 328Jet is an absolute disaster economically, and additionally, Midwest's business plan simply involves chasing after a segment of the market that is increasingly getting smaller. Furthermore, Midwest outsourcing their Milwaukee ramp to Skyway (OK, Skyway is wholly-owned by Midwest, but with much lower pay) will likely turn into a decision that will saddle them in this market for any passenger who isn't originating or terminating in Milwaukee. airTran pursuing this would be nothing short of a disaster.

Maybe an asset purchase by AirTran (or lease - does YX have any assets to sell?), but a merger might be overkill. DH also intrigues me, if only because of their large position at IAD. It'd be interesting to see someone be able to do something with them (i.e. codeshare). May be too late, though.

-Dave

-Dave

Topic: RE: Airline Mergers
Username: SHUPirate1
Posted 2005-08-04 11:13:05 and read 2778 times.

Quoting PlanesNTrains (Reply 29):
People Express + Frontier, part 2? A 747 super shuttle between DEN and JFK? Hmmm...

I don't believe I mentioned putting any 747's between Denver and New York-Kennedy anywhere in my comments, and I obviously don't like that idea.

Topic: RE: Airline Mergers
Username: PlanesNTrains
Posted 2005-08-04 18:02:18 and read 2694 times.

Quoting PlanesNTrains (Reply 29):
People Express + Frontier, part 2? A 747 super shuttle between DEN and JFK? Hmmm...



Quoting SHUPirate1 (Reply 30):
I don't believe I mentioned putting any 747's between Denver and New York-Kennedy anywhere in my comments, and I obviously don't like that idea.

You conveniently ignored the smiley when quoting me - obviously, it was a tongue-in-cheek reference to the 80's - sorry if I implied something different. To clarify, no, you didn't mention 747's, and no, I wouldn't expect them to repeat the disaster that was PeopleExpress+Frontier.

-Dave

Topic: RE: Airline Mergers
Username: FlyPIJets
Posted 2005-08-04 18:44:00 and read 2638 times.

I have to admit that I rather enjoy reading the threads on the possibilities for the future of airlines. Barring the rather heated defending of positions, they usually relay a sense of airline enthusiast trying to figure out ways to keep as many airlines running as many airplanes to as many places possible.


For an interesting twist to the merger debate, I wonder if airline merging with a company outside the airline business would be advantageous for an airline trying to stay in business.

Some possible candidates I can think of would be:

GE
Exxon
Norfolk-Southern

I don't think it is a crazy idea at all. To me, the single biggest problem facing airlines is very similar to a problem facing new pilots, porpoising. Especially the type of porpoising that comes from trying to chase an altimeter.

Altimeters actually lag behind the actual altitude of an a/c. New pilots, learning to reach a desired altitude will sometimes try too hard to chase after the lagging of the altimeter causing an up and down, porpoise, of the a/c.

I think many of today's airline managers have fallen into this pattern with regard to normal business cycles. There are up and down periods, but, management is chasing those cycles, rather then being prepared for them (and ready take advantage of them).

Maybe it would be helpful for an airline to be part of a larger corporation that could provide much needed counter-weight and focus for the normal cycles in the airline biz.

Topic: RE: Airline Mergers
Username: Dartland
Posted 2005-08-04 19:11:03 and read 2613 times.

Any airline merging with a non-airline is even a worse idea than an airline merging with another airline -- and I mean no ill-will by that, just pure business perspective.

If you look at mergers across all industrys, ~80% fail (An average of -10% return after 13 months, and -15% return after 24 months). The 2 things that help mergers succeed are a) If the acquirer is a frequent acquirer (which no major US airline is), and b) if the acquisition is small (which none of the aforementioned airlines can be considered).

Essentially, acquiring another company is a core competency in and of itself (e.g. an airline's core competency is flying people around the globe, it is a complicated enough industry that they cannot afford to dabble in any other core competencies). So when companies such as airlines try and get into the business of merging, chance of success is VERY VERY LOW. For US and HP, well, they had no choice. US was going to go under unless they did something, so while their chance of success is low, it is likely higher than them succeeding on their own.

Once you bring a non-airline into the fray, chance of success goes down even more. Another business principle is that businesses should only grow from close adjacencies. GE, Exxon, and Norfolk-Southern would hardly be considered 1-degree adjacencies -- each step you go away from the core again lowers the chance of success (an example of a 1-degree adjacency would be an air cargo business, if an airline did not already have one).

So -- from a pure business perspective, no airline should even think about acquiring unless they are convinced they have almost no chance of survival without it. Given that, B6, F9, AA, CO should not even think about it. DL and UA are in worse shape -- but even so, merging probably only adds more risk and uncertainty.

Topic: RE: Airline Mergers
Username: FlyPIJets
Posted 2005-08-04 19:28:14 and read 2572 times.

Quoting Dartland (Reply 33):
GE, Exxon, and Norfolk-Southern would hardly be considered 1-degree adjacencies -- each step you go away from the core again lowers the chance of success (an example of a 1-degree adjacency would be an air cargo business, if an airline did not already have one).

That maybe true, but, in the example of GE, they have been successful with RCA which gives them a business line as varied as making aircraft engines to producing TV entertainment. Hardly 1 degree of separation.

With Norfolk-Southern you have a transportation company that could provide synergies much like Evergreen and EVA Air. (the N in N-S attempted this once in a bidding war with USAir for Piedmont, N-S has a fairly large inter-model transport biz.)

With Exxon, well, when oil prices go up, that cold be good for the goose and gander. Beside Exxon has a substantial retail business.

I was, of course, thinking one of these companies would overtake an airline, not the other way around.

Topic: RE: Airline Mergers
Username: Wdlf1
Posted 2005-08-05 03:35:21 and read 2430 times.

How about FL and AS buy 51% of UA take control and trim the fat go lowfare with the whole thing move the hdq to FL. Now that sounds like a winner!!!

Topic: RE: Airline Mergers
Username: STT757
Posted 2005-08-05 03:39:29 and read 2427 times.

CO+UAL with CO running the show, Corporate moving to Houston and Gordon Bethune arranging the financing (Boeing, GE etc..).

http://archives.californiaaviation.org/airport/msg32272.html

[Edited 2005-08-05 03:51:18]


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